You are browsing the archive for 2014 March 13.

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Patients, Families, Doctors Host Educational Medical Marijuana Forum Tonight in Mineola, Long Island

March 13, 2014 in PERSONAL LIBERTY

By drosenfeld

March for Compassion Continues Throughout the State as Support for the Compassionate Care Act Grows

Long Island – Tonight, patients, families, advocates, and doctors will host an educational forum in Mineola, Long Island. The public forum is part of the March for Compassion — a month-long series of actions and events across the state to educate New Yorkers about medical cannabis and build support for New York’s comprehensive medical marijuana proposal – the Compassionate Care Act (A.6357-A -Gottfried) / S.4406-A -Savino).

March 13, 2014

Drug Policy Alliance

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Source: DRUG POLICY

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Yes, Paul Krugman is an Underconsumptionist

March 13, 2014 in Economics

By William Anderson

One way to make a Keynesian bristle is to tell him that Keynesian theory at its core is little more than the discredited belief of “underconsumption.” Now, the standard “underconsumption” theory is built upon the premise that unless an economy can “buy back” the products that are created, the economy will drift into crisis as inventories pile up, layoffs occur, and the economy implodes into a perverse equilibrium — and stays there unless government intervenes to save the economy.

The problem, according to “underconsumptionists” is that people save too much (called “hoarding”) and that they are unwilling or unable to spend enough to purchase goods at prices that will permit the owners of factors of production to be paid their opportunity costs. Thus, the imbalance begins and then metastasizes unless government steps in with more spending and/or easy money.

For all of the supposed sophistication of the Keynesian theory, at heart it is nothing more than “underconsumption.” Certainly the so-called Keynesian cures for depressions are right in line with “underconsumption” theory even if they have sophisticated names like Monetary Policy or Fiscal Policy.

Enter Paul Krugman. Although he has said before that he does not subscribe to “underconsumption” theories, nonetheless his prescription for more economic growth — that government impose much steeper graduated tax rates than currently exist in the USA — fits exactly into the “underconsumption” mold. Furthermore, he argues that “equality of outcomes” is superior, economically speaking, than “equality of opportunity,” writing:

But how can the effects of redistribution on growth be benign? Doesn’t generous aid to the poor reduce their incentive to work? Don’t taxes on the rich reduce their incentive to get even richer? Yes and yes — but incentives aren’t the only things that matter. Resources matter too — and in a highly unequal society, many people don’t have them.

Think, in particular, about the ever-popular slogan that we should seek equality of opportunity, not equality of outcomes. That may sound good to people with no idea what life is like for tens of millions of Americans; but for those with any reality sense, it’s a cruel joke. Almost 40 percent of American children live in poverty or near-poverty. Do you really think they have the same access to education and jobs as the children of the affluent?

In fact, low-income children are much less likely to complete college than their affluent counterparts, with …read more

Source: MISES INSTITUTE

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Mt. Gox Problems Mount

March 13, 2014 in Economics

By David Howden

In the aftermath of the demise of bitcoin bank Mt. Gox comes a few startling revelations. A newly released “Crisis Strategy Draft” confirms some unfortunate truths long suspected of its handling of clients’ bitcoin deposits. (The document might be a fake, but I’ll accept it as legitimate until proof surfaces otherwise.)

The first unfortunate truth is Mt. Gox’s admission that it is a fractional-reserve bank. Seeing this problem for what it is, the company is now looking to enter into agreements with its partners to “erase a significant portion of [its] debt.”

I previously relied on the ample literature of how fractional-reserve free banks are supposed to work in order to illustrate why it was clear Mt. Gox was a fractional-reserve bitcoin bank (here, here and here). Here we have another case where free banking theory is, unfortunately, demonstrated to be true in practice. The free banking literature says that any liquidity problem faced by a member bank can be solved by asking for lines of credit and concessions from other banks. As long as the illiquid bank is fundamentally solvent there should be some deal struck to extend it credit to get it through its time of trouble until it regains its footing. Mt. Gox is seeking the help of other “Bitcoin main players” to assist it in injecting new bitcoins onto its books.

This strategy of seeking the assistance of other banks may seem positive in that it extends the life of an otherwise troubled bank. There is ample evidence to demonstrate that it is exactly these types of agreements to support each other that ultimately develop into larger centralizing arrangements. In a similar application, Philipp Bagus and I have documented how the Federal Reserve System emerged from a series of small arrangements between private fractional-reserve banks during the Free Banking Era that culminated into an agreement to centralize reserves and coordinating policy amongst the individual banks, first at the hands of the clearinghouse system, and later more formally through the creation of the Fed (available here as a pdf).

This bodes poorly for a bitcoin community which prides itself on the fact that it does not need government oversight or aid in solving its problems. There is a more troubling revelation in the Mt. Gox crisis strategy document however.

On its current balance sheet the company lists its assets as consisting of 2,000 bitcoins (plus …read more

Source: MISES INSTITUTE

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Jeff Deist and Ron Paul Discuss the Future of the Mises Institute

March 13, 2014 in Economics

By Mises Updates

RPC

And Dr. Paul’s years of promoting Austrian economics as a congressman.  On the Ron Paul Channel.

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Source: MISES INSTITUTE

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Needs Have Been Exaggerated

March 13, 2014 in Economics

By Chris Edwards

Chris Edwards

The tragic gas explosion in Harlem will likely revive complaints that America is a pothole nation with falling-down bridges, and that we desperately need to boost government infrastructure spending. The reality is more complex.

The first thing to note is that government infrastructure spending in the United States is at about the same level relative to the size of our economy as it is in other high-income nations.

Another thing is that the quality of much U.S. infrastructure has been steadily improving. Federal data show that of the roughly 600,000 bridges in the nation, the share that are “structurally deficient” plunged from 22 percent in 1992 to just 11 percent by 2012.

The surface quality of our highways is also improving. A study by Federal Reserve economists using “International Roughness Index” data found that “since the mid-1990s, our nation’s interstate highways have become indisputably smoother and less deteriorated.”

With the Harlem disaster, people are pointing to Consolidated Edison’s 127-year-old cast iron pipes as the obvious problem. They may be, but we should not just assume that old infrastructure represents a failure.

Con Ed has an ongoing program to replace its old pipes, but we can’t repipe and repave the entire nation every year. Instead, there is an optimum replacement rate for all infrastructure. Consider that it would be too costly for you to buy a new car every year, so you balance the new-car price with the rising maintenance costs on your old one.

As for cast iron, note that the famous Iron Bridge in Shropshire, England is 235 years old and still standing.

For governments, finding the optimum replacement rate is difficult because they operate outside of markets. So the big issue with government infrastructure spending is not so much the level of it but the efficiency of it. In my experience, much of it gets misallocated by politics, and projects are often mismanaged and go over budget.

The good news is that four-fifths of all U.S. infrastructure spending is private, including everything from energy pipelines, to cell phone towers, to factories. Companies will aim for the optimum level of investment if they can earn a decent rate of return. In this regard, policymakers can help by removing tax and regulatory barriers that companies such as Con Ed face in pursuing their upgrades that benefit all of us.

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Source: OP-EDS

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Sen. Rand Paul Appears on Fox's America's Newsroom- March 13, 2014

March 13, 2014 in Politics & Elections

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Source: RAND PAUL

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John Rawls and Market Anarchy

March 13, 2014 in Economics

By Mises Updates

Immigration Protest at White House

David Gordon writes in today’s Mises Daily: 

Gary Chartier in this impressive book has put readers doubly in his debt. Chartier strikes at the heart of the vastly influential political philosophy of John Rawls. Libertarians can only applaud him for this, but we have even more reason to be grateful to Chartier. Having neatly dispatched Rawls, Chartier goes on to offer a strong defense of market anarchy.

There is, I fear, a problem with what I have just said. Chartier would not agree with my description of what he has accomplished. Although, as he tells us, “I am not a Rawlsian,” (p. x) he does not aim to refute Rawls. To the contrary, he aims to show that Rawls’s system, suitably modified, leads to market anarchy. I do not think that he succeeds in showing this; but it is in his attempt to do so that he in fact refutes Rawls.

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Source: MISES INSTITUTE